CASE 24 Ethics and AirbusOne September, a fraud squad, led by Jean-Claude Van Espen, a Belgian magistrate, raided Airbus’s headquarters in Toulouse. “They wanted to check whether there was possible falsiﬁcation of documents, bribery or other infractions as part of the sale of Airbus aircraft to Sabena,” says Van Espen’s spokesman. The team of 20 Belgian and French investigators interviewed several Airbus employees during its three-day stay in Toulouse and carted away boxes of documents. In November 1997, Sabena had approved an order for 17 Airbus A320s (narrow-bodied aircraft), which it did not need. Even more oddly, it had doubled the order at the last minute to 34, a move that helped trigger the airline’s collapse four years later. Although nominally controlled by the Belgian government, Sabena was run by the parent company of Swissair, SAirGroup, which had owned a stake of 49.5 percent since 1995 and which also went bust in 2001. A former Sabena manager, who arrived after the Airbus order was placed, says that the planes were not needed: “It was a fatal business decision.” A Belgian parliamentary commission’s recent report conﬁrms that the Airbus order was a big cause of Sabena’s collapse. Van Espen’s separate criminal investigation is continuing. According to the report, it started in October 2001 after Philippe Doyen, then a Sabena employee, lodged a complaint. Among other things, he suggested to Van Espen that he interview Peter Gysel, a former Swissair employee now working at Airbus, who put together Sabena’s deal with Airbus. Gysel denies any impropriety. The former Sabena manager says: “I never got the slightest whiff that the decision was driven by kickbacks, sidepayments, and so on. But I cannot rule anything out.” Neither does Van Espen. Today airlines are ordering about 400 aircraft a year. But in good times, 800 planes, worth around $60 billion, are sold a year. In the past ten years Airbus (originally a consortium, now owned 80 percent by EADS and 20 percent by BAE Systems) has caught up with Boeing, which had enjoyed two-thirds of the market since its 747 jumbo-jet entered commercial service in 1970. Many aircraft are no doubt bought and sold in entirely conventional ways. But many are not. After all, lots of airlines are still state-owned and not subject to normal business rules. Commission payments (licit or illicit) on multimillion-dollar aircraft deals increase the capital cost of aircraft, which are therefore subject to higher depreciation or operating-lease charges, or both. But these extra costs are barely discernible in the pool of red ink created by the carriers’ perennial losses. Aircraft purchases drag on for years, as airlines play Boeing and Airbus off against each other. Especially in a buyer’s market, deep discounts are common, performance guarantees are demanding, and manufacturers have to offer all sorts of sweeteners (e.g., aircraft trade-ins, unusual guarantees) to persuade an airline to switch to their aircraft. Unsurprisingly, given the regulated nature of international air travel, politics plays a part. For instance, no sooner had Air Mauritius bought Airbus A340s in 1994 than it obtained an upgrade from Paris Orly to Charles de Gaulle airport, which is Air France’s main base with better onward connections. Aircraft purchases have long been associated with controversy. In the 1970s, when Lockheed was still making civil jets, it was caught bribing Japanese ofﬁcials to buy its L1011 wide-bodied airliner. A Japanese prime minister was later charged and convicted in 1983 for taking a bribe. Prince Bernhard of the Netherlands was also disgraced for his involvement with Lockheed. This scandal led in 1977 to Congress passing the Foreign Corrupt Practices Act (FCPA), which forbids American companies, their ofﬁcers, or their representatives from bribing foreign ofﬁcials. Critics have often pointed out that American ﬁrms can sidestep the FCPA by using foreign subsidiaries and nationals to pay...

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...lapses of Airbus?
The case study shows that politics play a major role in ordering the aircrafts from the manufacturers. Kickbacks are encouraged not only by the politicians but the manufacturers as well.
In the first case in Belgian where Sabena orders 17 Airbus planes and later increases the order to 34 which it did not need at all. It’s this move helped trigger airline’s collapse four years later its order. A former Sabena manager agrees to this, “It was a fatal decision”. A Belgian report also confirms that that the Airbus order was a big cause of Sabena’s collapse. Thus, in this case it is obvious that Sabena suffered.
In the Kuwaiti kickbacks case, Kuwait Airways Corporation (KAC) chairman Al Mishari announced an order of 15 Airbus airplanes worth $1.1 billion. Later Airbus chipped in $450,000 to set up and provide the running costs for the Aviation Lease and Finance Company (ALAFCO). But later due to Kuwait Finance Ministry’s watchdogs, the deal was never sanctioned. Thus, in this case Airbus suffered.
In India, Indian Airlines had ordered 19 Airbus A320s worth $952 million in 1986. But there was an FIR launched and the case is going on till date. During this case Boeing offered to supply up to 35 of its 737 aircraft with a discount of $5 million per plane. This offer would have reduced IA’s investment by $140 million but IA did not take it obviously due to the...

...﻿Question 5
Boeing and Airbus competed in the same 4 segment of the aircraft market. Both companies have been in a tight competition up to the time of the case. In 2005 Airbus sold 82 more airplanes than Boeing did (1,111-1,029), though at the same year Boeing won the orders in “terms of value”.
Unfortunately for Airbus, Boeing announced a new plane that was intended to replace B767, the plane was more fuel efficient and crated a “buzz” within the public when Boeing started the naming competition for the new plane.
B787
A350
A350XWB
Planned Price
120M (448 orders)
150M (180 orders)
Actual Price
157-167M
190-250M (20 orders)
After Boeing announced, that the price at low for B787 would be 120M, it was taken as a surprise to the industry, which could mean that the airplane was underpriced, and could potentially be a failure for the company. Airbus, on the other hand, priced A350 reasonably, though compared to Boeing, 150M for an airplane of that class was not taken as great by the customers. In the end Boeing had to charge 157-167M for B787, which apparently was a market value, though the company had already managed to undercut the competition with its rival Airbus.
Pricing strategy for A350XWB was a failure, even though A350XWB included some innovation and was better than B787, apparently, not enough customers are ready to pay a premium price for the airplane of that class.
The prices of B787,...

...Introduction
Background of Airbus Corporation
Airbus began as a consortium of aerospace manufacturers. Consolidation of European defence and aerospace companies around the turn of the century allowed the establishment of a simplified joint stock company in 2001, owned by EADS (80%) and BAE Systems (20%). After a protracted sales process BAE sold its shareholding to EADS on 13 October 2006.
Airbus employs around 57,000 people at sixteen sites in four European Union countries: Germany, France, the United Kingdom, and Spain. Final assembly production is at Toulouse (France), Hamburg (Germany), Seville (Spain) and Tianjin (China). Airbus has subsidiaries in the United States, Japan and China
Airbus Industrie was formally established as a Groupement d'Interet Economique (Economic Interest Group or GIE) on 18 December 1970. It had been formed by a government initiative between France, Germany and the UK that originated in 1967. The name "Airbus" was taken from a non-proprietary term used by the airline industry in the 1960s to refer to a commercial aircraft of a certain size and range, for this term was acceptable to the French linguistically. Aerospatiale and Deutsche Airbus each took a 36.5% share of production work, Hawker Siddeley 20% and Fokker-VFW 7%. Each company would deliver its sections as fully equipped, ready-to-fly items. In October 1971 the Spanish company CASA...

...﻿When determining the status of morality there is three different options. Morality may be the different between objectives, relativistic, or it may be a complex set of rules. Moral nihilists are like relativists by denying ethical objectivism however, relativists believe in moral goodness, duty and virtue and nihilists don’t. Error theorists and expressivism are both forms of moral nihilism. Error theorists believe “our moral judgments are always mistaken”. Expressivists don’t agree and also deny that our moral claims can ever offer an accurate take on reality. (307)
Error theory and expressivism are two forms of moral nihilism. Error theorists believe “our moral judgments are always mistaken”. (307) While expressivists deny those beliefs and deny, “that our moral claims can never offer an accurate take on reality”. (307) The error theory is made of three doubts/claims.
The first is “there are no moral features in this world”. Error theorists believe that nothing is morally good or bad, or right and wrong. Exemplified in the book many scientific qualities in the world (liquids, being three feet long, carbon based chemicals) but none of them contain moral features. The next doubt of error theorists is no moral judgments are true. There are no moral facts so certain statements made cannot be true. The third corresponds to the second doubt, “our sincere moral judgments try, but always fail, to describe the moral features of things”. Since there are no moral truths for...

...﻿
Ethics Of….
Boxing is a violent sport full of hate where the only objective is to knock your opponent unconscious. This is a very quick and biased view of boxing because if you study boxing closer it helps teach the person about their moral character. Boxing helps teach people to “get off the canvas and roll with the punches” (Marino, 2010, para 8) and to face their fears, two important lessons to get through life. Throughout the article written by Marino, he educates about Aristotelian ethics and uses boxing as a real-life example. I believe that Marino’s invocation of Aristotelian ethics is well articulated, and I agree with his application through boxing relating it to your life. Aristotelian ethics and boxing can relate to the rights and responsibility lens; boxing can help develop our moral lives and can clearly define and educate people about Aristotle’s definition of courage.
The sport of boxing and comparing it to real-life morals and virtues is extremely well done by Gordon Marino using Aristotelian ethics. The moral virtues that Aristotle preached such as “qualities, temperance, justice, pride, and truthfulness” (Marino, 2010, para. 11) all can be directly applied to Kantian ethics and the rights/responsibility lens (DesJardins, 2012). Boxing is a man versus man, woman versus woman sport which “can compel a person to take a quick self-inventory...

...1. (TCO A) Companies put forth a ________, a set of benefits that they offer to customers to satisfy their needs. (Points : 6)
brand
value proposition
deal
marketing plan
demand
Question 2.2. (TCO A) Samuel Adams trains his company's sales force to go after the consumer. Sam repeatedly asks his team to bear in mind the essential fact that it is the sales team's responsibility to rouse the consumer's interest and make him feel that he needs the product. A true salesman is one who can convert an indifferent consumer walking into the store into a new customer. Sam believes in the ________ concept. (Points : 6)
product
production
selling
marketing
social responsibility
Question 3.3. (TCO A) Which of the following is one of the five major characteristics of good mission statements? (Points : 6)
They focus on a large number of goals.
They expand the range of individual employee discretion.
They define the major competitive spheres within which the company will operate.
They take a short-term view.
They are long and comprehensive to ensure that all critical concepts are included.
Question 4.4. (TCO C) Which of the following statements is true of marketing plans? (Points : 6)
They can be independently developed without worrying about other functional areas.
They provide direction and focus for a brand, product, or...

...4-2 Report on how the business could improve the ethics of their operations whilst meeting objectives and ensuring good employer / employee relationship 6
4-3 Design a suitable ethical code 7
Conclusion 8
References 9
Acknowledgement
This report is about the ethical approaches and practices are adopted by the business firm. It is very beneficial for the company, because it is increase the goodwill and improves the efficacy of the workers. The main aims of adopting the ethical activities to enhance or promote the goodwill of their business.
In this report we will discuss the different ethical approaches and ethics activities are adopted the mostly public firms and many small scale business have embraced ethics as a guide to their operations. Employee empowerment helps to create innovation, and employee have a stake with the company and providing the more beneficial ideas and problem solving solution when the obstacles are arises. The main objective of policy is not to be build or create but convince the employee that is better and it is a better way for or solution the problems. Different approaches which are most ethical path and realize to evaluate the different situation in using the different criteria. Constant learn about ethics and apply to real world business decisions
Introduction
Ethical activities and practices that are adopting by the companies and it are mandatory by the government to follow these....

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